The court may order ETF to give your former spouse (alternate payee) up to 50% of your WRS benefits (WRS account or annuity). This court order is called a Domestic Relations Order (DRO). Once ETF has officially recognized and accepted the DRO, it becomes a Qualified Domestic Relations Order (QDRO). The only way to divide a WRS account or annuity is through a DRO that is issued by a court and accepted by ETF as a QDRO. Consult with your attorney regarding your legal rights.
An alternate payee is the former spouse or domestic partner of the WRS member who has been awarded part of the member’s WRS account or annuity by the court and a Qualified Domestic Relations Order.
Important Points for Everyone to Know
- We divide your account on the first of the month that you are divorced. For example, if your divorce is granted on March 20, your account is divided as of March 1 .
- It is your responsibility to make sure your DRO is submitted to ETF as soon as possible to avoid back payments.
- Know who your WRS beneficiaries are. You may or may not want your former spouse as your beneficiary. Contact ETF to review your current beneficiaries on file.
- Update your WRS beneficiaries at any time before or after the divorce is final by completing and submitting a Beneficiary Designation (ET-2320) form or Beneficiary Designation—Alternate (ET-2321) form. You must submit a new beneficiary designation form to remove your former spouse or domestic partner.
- Update your Wisconsin Deferred Compensation Program (WDC) beneficiaries by logging in to your account. After you've logged in, you will be taken to the My Beneficiaries page to make updates.
- An alternate payee is required to apply for their benefit; it is not automatic (except for named survivors).
How it Affects Members Who are Not Retired
The order divides your current retirement account and years of service at the time of your divorce. The alternate payee does not have access to any money you put into the account or years of service you earn after the divorce. A portion of your account is transferred to a separate account for the alternate payee. The account is considered an inactive account for benefit purposes.
Alternate payees may apply for benefits at any time, regardless of their own age or employment status. However, the type of benefit available is dependent on your (the member’s) age.
- The alternate payee can apply for the full benefit once you reach minimum retirement age and are vested.
or
- Before you reach minimum retirement age, the alternate payee may receive a one-time lump-sum payment called a separation benefit, which includes only the employee portion of the benefit. See the Separation Benefits (ET-3101) brochure for more information about separation benefits.
How it Affects Retired Members
The order divides your monthly payment at the time of your divorce. The alternate payee receives a separate payment based on the percentage awarded by the QDRO.
Your annuity option may also change depending on the type you chose*:
- Life Annuity Options stay the same
- For Annuitant’s Life Only
- Life with 60 Payments Guaranteed
- Life with 180 Payments Guaranteed
- Joint and Survivor Annuity Options change to For Annuitant’s Life Only
- 75% Continued to Named Survivor
- 100% Continued to Named Survivor
- Reduced 25% on Death of Annuitant or Named Survivor
- 100% Continued to Named Survivor with 180 Payments Guaranteed
- Annuity Certains stay the same
*The alternate payee receives the same payment option the member receives.
Accelerated Payments
An accelerated payment option provides a higher benefit amount until age 62. ETF splits the accelerated payment between the annuitant and the alternate payee. The accelerated portion of the payment will continue until each person turns age 62. Once each person reaches age 62, the accelerated portion of the payment will stop.
How it Affects Alternate Payees
(Member's former spouse or domestic partner)
You may receive up to 50% of the WRS account or annuity of the member (your former spouse or domestic partner). You will have the option to apply for different types of benefits. Alternate Payees may apply for benefits at any time, regardless of their own age or employment status. However, your benefit effective date is dependent on the member's age and when your application is submitted to ETF. Based on the decree date listed on the DRO and when the application was received, ETF can only backdate a benefit effective date up to 90 days.
| Member is below Minimum Retirement Age* | Member is over Minimum Retirement Age* |
|---|---|
| You may only apply for a separation benefit. Carefully consider taking a separation benefit. You will lose approximately half of the value of your WRS account (employer contributions and interest). | You may apply for a retirement benefit as long as the member is vested. You will receive an annuity that includes the full value (employee contributions + employer contributions + interest). |
*Minimum Retirement Age (MRA) is the earliest age that a member can begin receiving a retirement benefit (assuming you meet all other eligibility requirements). A member must be age 55 (50 for protectives) to reach MRA. For more information, see the How Divorce Can Affect Your WRS Benefits (ET-4925) brochure.
How it Affects Your Wisconsin Deferred Compensation Program Account
A DRO may also be submitted for your WDC account. See the Order to Divide Wisconsin Deferred Compensation Program Account (ET-2367) for more information. A $250 cost to process a DRO is evenly split and deducted from the WDC accounts of the participant and alternate payee(s).
How it Affects Your Life Insurance
Members should review their life insurance coverage to determine if they have Spouse and Dependent coverage. A former spouse is no longer eligible for Spouse and Dependent coverage as of the date the marriage is terminated. If the former spouse is the only dependent, the member must contact the employer to cancel the Spouse and Dependent coverage. However, members may elect to maintain this coverage if they have children covered under their Spouse and Dependent plan.
How it Affects Your Health and Other Insurance Benefits
Members may have the opportunity to enroll or change coverage levels for their health and other insurance benefits. Please note: your former spouse is not automatically removed from coverage. Active employees must notify their employer to have their former spouse removed and change coverage levels. Retired members must notify ETF to have their former spouse removed from coverage.